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[Bulletin-Department of Agriculture]

California farm production and value-Estimates of the production and farm value of principal products of California farms in 19541

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California farm production and value-Estimates of the production and farm value of principal products of California farms in 19541-Continued

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1 Brief explanatory notes about the data in the above table: Besides the commodities listed, there are many relatively minor crops grown and a number of livestock and poultry commodities produced in the State for which official estimates are not made. Therefore, these data do not record total production nor total value of all farm commodities.

The figures for crops listed include quantities and values of the portions of those crops fed to livestock and poultry on farms where grown, and thus relate to the entire crop in each case, whether or not sold or fed in the year produced. The value figures for livestock, poultry, and their products represent the cash receipts by producers from the sales of same during the calendar year 1954. Thus, a combined total of the values listed in the table would include some duplication between the values of crops grown and the receipts from the sales of livestock, poultry, and their products.

A more acceptable measure of the overall annual value of the State's farm production is shown by the department's estimates of the cash receipts from producers' sales of farm products during the calendar year. In these are included estimates for minor commodities. These estimates for 1953 and 1954 are shown below. During the 25-year period 1930 to 1954, inclusive, cash receipts from farm marketings by California farmers have exceeded those from any other State, except for the years 1940, 1941, 1942, 1947, and 1949 when California ranked second to Iowa in this respect.

Estimated cash farm receipts from farm marketings, California—1953 and 1954

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Source: California Crop and Livestock Reporting Service, Sacramento; U. S. Department of Agriculture, Agricultural Marketing Service; California Department of Agriculture, Bureau of Agricultural Statistics.

The CHAIRMAN. May I suggest that witnesses, particularly those who will listen to those testifying, listen carefully and try to prevent as much duplication as possible. We are building up a record here. It is my hope that there will not be too much repetition. I want to give assurance to those who may not have an opportunity to read their entire statements that whatever they have to say will be printed in the record in full, as though they had stated it. We are here with you for 5 or 6 hours. I realize that California produces quite a few products, as has been stated by Mr. Dick just a moment ago and it will be necessary, because of the large number of witnesses, to hear but a few representing each commodity.

I wish to place in the record at this point a telegram addressed to me and signed by Mr. James D. Lynch, secretary, San Fernando Valley Poultry Cooperative, Inc., and another from Mr. John S. Watson, 498 Pepper Road, Petaluma, Calif., both of which are addressed to me. (The telegrams are as follows:)

Hon. Senator ALLEN ELLENDER,

Hotel Californian, Fresno, Calif.:

SAN FERNANDO, CALIF., October 31, 1955.

On October 27 we aproved the five-point program as sponsors by the California Farm Research and Legislative Committee to aid the poultry and egg producer. We urgently request your indulgence with regard to this program.

JAMES D. LYNCH,

Secretary, San Fernando Valley Poultry Co-op, Inc.

Senator ALLEN ELLENDER,

PETALUMA, CALIF., November 1, 1955.

Chairman, Senate Agriculture Committee, Fresno, Calif.:

I am a dairy farmer of Petaluma, Calif., and chairman of the Democratic Farmers Advisory Committee of California. Pressure of farmwork prevents my attendance at this hearing. Our committee, composed of outstanding farmers, fruitgrowers, livestock and poultrymen, anticipated and forecasted the current depressed condition in agriculture 3 years ago. We now reassert our position on the farm price-support program. We favor restoring and maintaining the price-support program on basic crops at a firm level of 90 percent of parity. The farm price-support program should provide for sound, adequate, and equitable treatment for all segments of agriculture and for the authority to the Secretary of Agriculture to utilize parity production payments to farmers in combination with other improved methods of support and production controls. We disapprove of "flexible" price support since fair prices to farmers would accrue only under conditions of scarce supply. Scarce supply is not in the public interest, which is best served by ample supplies of farm commodities backed up by sufficient receivers properly handled.

JOHN S. WATSON.

The CHAIRMAN. The first witness representing the dairy industry will be Mr. James N. Fulmor, of Dixon, Calif.

Will you give your name in full for the record and your occupation, please, sir?

STATEMENT OF JAMES N. FULMOR, DIXON, CALIF.

Mr. FULMOR. Mr. Chairman, and gentlemen of the committee, my name is James N. Fulmor, a milk producer of Dixon, Calif. I am here as an individual representing the California dairy industry.

In the year and a half that has passed since the lowering of price supports the one word that best describes the dairy industry of California is that it is stabilized. Dairy farmers in California produce two types of milk: Grade A which is used for fluid milk and cream; and grade B which is used for manufactured dairy products. Production of grade A has been on a rather uniform basis, pricewise; the last change statewide was in January of 1954. Grade A production has increased about 5610 percent in this period, while grade B production, or that milk in California which is produced entirely for manufactured dairy products, has increased 10 percent in the like period. These figures illustrate the small range of change in the overall dairy production picture in California. California, as you probably well know, is still experiencing an upsurge in population, which upsurge during the last year and a half amounts to about one-half million people. This population increase tends to relieve grade A producers of some of the penalty for having increased production.

The penalty of grade A producers for producing above the level or amount that is needed in a given market for fluid purposes is to have their blend price, or the average price received for their entire production, lowered. An ever-expanding market, brought about by increased per capita consumption or by population increase, is one of the most certain ways of increasing returns to grade A producers. We producers here in California have had this population increase as a windfall as our population has increased from 6 to 12 million in the space of about 15 years. Some of the provisions in our California Milk Marketing Act have been helpful along this line; namely, the proviso that milk can only be purchased by contract between producer and distributor. Second, that each contract must state in pounds of milk

or pounds of butterfat the amount required to be delivered by said producer. It should be further noted that our State law does not guarantee to a producer a market for his milk; it is his responsibility to find a market.

To this contract proviso must go some of the credit for keeping supply pretty well in line with production, for during the past year and a half production has only exceeded use by 12 to 14 percent. As for manufactured dairy products, California has been an importer of butter and hard cheese for many years. California does export in some quantities dried milk and condensed milk. Nationally, there is about 1 cow for every 7 people, while in California the ratio is approxmately 1 cow to 14 Californians. However, our supply is much better than the figures indicate as California cows exceed the national average of production by about 50 percent.

Mention has already been made of our population increase as the easiest way of reducing surplus supplies of dairy products. However, the dairy industry in California has for some years past carried on promotional, educational, and research programs, all of which have had as their primary purpose the securing of wider acceptance for all dairy products by all members of the family. During the 9 years of this statewide supervised activity, whose funds are entirely raised by the dairy industry, consumption of fluid milk has shown a steady increase. In addition to this activity, many of the marketing areas in California have raised additional funds to be spent locally in promoting grade A sales. These local spending units are about evenly divided between two groups, one of them raising their own funds under the general supervision of our Milk Control Act whereby all producers contribute equally, and the other groups organized on a purely voluntary contribution basis. These latter groups are supported only by signers of their bylaws. And also operating in California are national producer and distributor groups with programs all promoting greater use of dairy products. The combined efforts of all these local and national groups no doubt have been contributing factors in making California's dairy industry the stabilizing influence that it has been in the economy of the State.

A new factor affecting California's dairy industry appeared at the national level in 1954. At that time Congress enacted legislation providing money for a special school-milk program. The rules and regulations set up by the USDA for administering this program during its first year of operation were such that many of our school districts in California failed to avail themselves of this opportunity for increased consumption of fluid milk. Consequently, we in California did not use our entire allotment of funds from the Federal Government during the first year of the program.

However, due to changes in the USDA rules and regulations, we now find over 1,100 school districts participating where last year we had something less than 600 districts under the special milk program. Experience in the Los Angeles city school system illustrates the improvement in participation. Last year Los Angeles schools did not come under the special milk program. This year they are participating with remarkable results. During the first 15 days of this school year they sold well over 2 million bottles of milk to students. This was an increase of 64 percent over last year's sales. At the same time, they changed from half pints to third quarts and this

accounts for an additional automatic increase of 333 percent in volume of milk sold and consumed. California school administrators now face the $2,611,595 allotment from the Federal Government as being one which will be entirely used up by our school districts, and conceivably may be inadequate for covering the needs of the program for the full school year. This is, of course, fulfilling the hopes of those who designed the Federal legislation providing the funds, and a continuation and expansion of this special school-milk program will obviously help to relieve the pressure on accumulating dairy products. Our school administrators trust that the interest of the Congress will continue the program, developing as it does the improved health habits of the school children not only in California but throughout the Nation.

The general public is also using more milk per capita in California-during the past 25 years consumption per capita has increased from 92.3 quarts per year to 126.4 quarts per year. No one group alone could claim to have caused this increase. Rather, it is the result of good work, of preaching and telling the story of milk by many agencies such as our health departments at State, county, and local levels; dental associations, national, State, and local people; medical associations, national, State, and local levels; home economists such as American Home Economics Association; dietitians, such as the American Dietetics Association; school health groups; especially school nurses; parent-teacher associations; school food service associations; and community health councils. The important nutrition education programs of these professional groups are aided and supplemented by the work of our own agencies such as the California Dairy Industry Advisory Board. To these can be added, also, the good work by individual companies in brand advertising and all the other agencies interested in the welfare of the dairy farmer and the health of our people.

No comprehensive view of the dairy situation in California could overlook the fact that it is generally recognized that grade A producers are faring better than grade B producers-two facts tend to prove this beyond much doubt. One: approximately 4,500 grade A producers holding grade A shipping permits produce roughly twothirds of all the milk produced from California's 850,000 cows, while approximately 22,000 grade B producers produce the remaining onethird of California's milk supply. The second point is that there is no change back from grade A to grade B where a grade A market is available; the movement is all in one direction-from grade B to grade A. These two facts stand out as irrefutable evidence of the value of our own California milk laws to the dairy farmers of our State.

No one viewing our industry from a statewide basis could help noticing some of the imbalances that do exist-producers in one section claiming State-fixed minimum prices are too low to maintain them in their dairy business, while at the same time producers in other sections of the State are wanting to come into the grade A market and are willing to spend the $10,000 to $15,000 for facility improvements that such a changeover generally costs.

Two problems in one confront the Congress on dairy products: What to do with accumulated stocks and what plan to adopt to avoid repeating the accumulating process. By now, many people in Govern

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